S&P lifts Equinox

Standard & Poor's said it raised the corporate credit rating on Equinox Holdings Inc. to B from B-.

The outlook is stable.

S&P said the upgrade is based on good operating performance, lower leverage and improvement in EBITDA coverage of interest.

The B rating reflects Equinox's geographic concentration, relatively small scale in a struggling economy, high debt leverage, aggressive club expansion plans and the increasingly competitive fitness club market, the agency said.

These considerations are partially offset by the company's leading brand franchise, strong New York club cluster, healthy same-club revenue and membership growth, and good profit margins, the agency noted.

Lease-adjusted consolidated debt-to-EBITDA ratio improved to 7.2x from 8.x.

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